Turkey poultry industry affected by economic crisis

Introduction: according to information released on January 22 on the website of the Overseas Agricultural Bureau of the United States Department of agriculture, Turkey is experiencing a serious economic crisis, which will have a negative impact on the feed and meat industry in Turkey According to the agricultural Counsellor's report, the first economic crisis occurred in November 2000, and by February last year, Turkey's lira began to depreciate significantly, aggravating the crisis In three months, the Turkish Lira was changed from 685000 lira to 1.2 million lira to 1.5 million US dollar, and fell to 1.65 million lira to 1.65 million US dollar in October 2001 In eight months, it was devalued by 140% Since then, the lira exchange rate has been stable The current exchange rate is 1.36 million lira to 1 US dollar In the past 20 years, the meat industry has developed rapidly and persistently Many processors have expanded their operations to modernize their equipment to meet the growing demand and increase their market share Most of these enterprises make high loans in their business activities Their expanded reproduction is supported by banks, as interest rates were low (relative to Turkey) before the crisis, and business prospects are expected to be good When the economic crisis happened, most of these enterprises were in debt Moreover, the meat industry relies on foreign exchange loans to purchase feed production raw materials, because feed raw materials, including soybeans, soybean meal, corn, inorganic substances, feed additives, etc., are all imported Feed costs account for 80% of the cost of a chicken According to the agricultural counsellor, in 2001, Turkey's real national income decreased, leading to a decline in consumption Poultry producers are unable to raise prices to make up for the loss of currency depreciation The price of meat sold in lira has remained stable for quite a long time, but the real price is depreciating Feed processors are also forced to absorb most of the increased costs themselves Most feed processors and poultry producers have started to reduce inventory, reduce supply customers, and minimize the credit time of customers (although in many cases it doesn't work) Poultry producers have found that their customers, whether small wholesale stores or large supermarket chains, are seeing a decline in retail sales, which usually take four to five months to pay, compared with one to two months previously Later, two large poultry processing plants decided to sell their products at lower loss prices to recover cash and repay debt At this time, the financial situation of most poultry industry has become worse The economic crisis has forced most chicken processors to reduce production Two of Turkey's top 10 poultry processing plants were forced to close The rest of the processing plants are still struggling because the economy has not improved and the demand for meat has not increased The feed processing industry and poultry processing industry are both asking for government support and help Large processing plants need government guarantees and persuade banks to continue to expand foreign exchange loans for imported feed Most people in the industry are pessimistic about how to improve the economic situation in the near future, but most believe that the economy, including demand growth, will improve in the second half of the year Egg production was relatively good, although production declined slightly in 2001 Recently, the demand and price of edible eggs have become more stable Due to the decrease of consumers' income, the sales volume of eggs with lower price increased, while the sales volume of red and white meat with higher price decreased The outlook for 2002 is also not optimistic In 2001, the total production of feed decreased significantly The impact of the economic crisis on the large-scale registered feed processing plants seems to be greater than that on the small-scale (unregistered) feed processing plants Those small feed factories can reduce production costs by avoiding taxes According to the feed industry report, the price of products they sold in lira rose by only 75% to 80% last year, while the value of lira fell by as much as 120% The estimated feed production in 2001 has not been published Turkey has many unregistered feed processing plants, which usually account for 25% of the total market, and the proportion may be higher in 2001 The total feed production in 2000 is estimated to be 9 million tons, including the production of registered and unregistered processing plants Total feed production is expected to decline by 25% in 2001.